The revival of rural incomes off the back of robust commodity prices is driving interest in provincial commercial and industrial property and expected to buoy investor enquiry on a prominent supermarket asset in suburban Taranaki that is now for sale.

The land and buildings supporting a well-performing Woolworths supermarket in the New Plymouth suburb of Spotswood have come to the market, with the private syndicate owners relinquishing the asset having held it since construction in 2011.

Occupying a prominent 1.15ha corner site with a strong profile to the main arterial route South Road/State Highway 45 and to Manadon Street, the approximately 4,187sqm Woolworths store recently underwent a high-spec refurbishment programme, including a new extension to accommodate grocery collection and home delivery services. Perimeter landscaping defines the property’s footprint, and there is logical and streamlined access to the store.

There are 164 customer car parks directly in front of the store, with inwards goods’ access to the rear of the property via a right of way off Manadon Street. The underlying zoning is Local Centre, a designation that allows for retail hubs to support neighbouring residential catchments. Woolworths Spotswood services a large suburban catchment including the Whalers Gate, Moturoa, Omata, and the coastal village of Oakura which is around 10km from the store.

General Distributors Limited, a subsidiary of the ASX-listed Woolworths Group, pay a base rent of $1,235,000 plus GST per annum, and recently-extended its 10-year term through to April 7th 2035, with the lease having a final expiry of 2070 if all future renewals are exercised, and mechanisms for rental growth.

Mike Houlker and Sunil Bhana of Bayleys Auckland, along with colleague Iain Taylor of Bayleys Taranaki are taking 6 Manadon Street, Spotswood, New Plymouth through a deadline private treaty campaign, closing Thursday 30th October, unless sold prior.

Supermarket-anchored properties are viewed as a defensive asset class, and always attract significant investor interest according to Houlker, who says Woolworths Spotswood is considered a trophy asset in the town.

“The property has been brought up to date with a modern refurbishment and capacity to service the changing shopping habits of customers, including the direct to boot service for online shoppers,” he says.

“Woolworths has 184 stores operating in New Zealand, and as an essential service company, both drives and responds to evolving customer preferences for how they shop and receive orders.

“This property is now well-positioned for the future and ready for new ownership with our expectation being it will appeal to another private syndicate or investment entity, or a high-net worth individual - perhaps a farmer looking to invest in a flagship local asset.”

Taranaki has a dairy-centric regional economy and Taylor says Bayleys Taranaki is seeing investor confidence return to the market, underpinned by strong farmgate returns and the lower interest rate environment.

“There’s definitely more optimism from investors, and greater sentiment in general given the latest record farmgate milk payout. Because Fonterra is farmer-owned, dollars will circulate in the local economy which is good for everyone.

“In provincial New Zealand, local investors like to have a stake in their community and see it thrive. Woolworths Spotswood is likely to resonate with well-resourced farmers or aligned investment entities as bricks and mortar property is a tangible asset that has held its own across market cycles, with the supermarket sector particularly resilient.”